Muthoot Fincorp Limited NCD Opens on Sep 27, 2019

Muthoot Fincorp Limited NCD Opens on Sep 20, 2019

Muthoot Fincorp NCD September 2019

Muthoot Fincorp Ltd is a non-banking financial company. The company offers personal and business loans. These loans are secured by gold ornaments and jewelry. It has announced its NCD issue worth of Rs 500 crore. Muthoot Fincorp Limited NCD is scheduled for subscription on 27th Sep 2019. It will close on 18th Oct 2019.

Investors who have the interest to invest in the Muthoot Fincorp NCD scheme will check other details of the NCD issue. It offers interest rates up to 10 percent and yield works up to 11.03%.

Basic Details of Muthoot Fincorp Limited NCD 

 Issue Open  Sep 27, 2019, to Oct 18, 2019
 Name  Muthoot Fincorp Limited
 Security Type  Secured, Redeemable, Secured NCDs
 Base Issue Size  Rs 250 crore
 Shelf Issue Size  Rs 250 crore
 Issue Price  Rs 1000 per NCD
 Minimum Lot size  10 NCD bonds
 Market lot  1 NCD
 Listing at   BSE
 Credit Rating  BWR A+ / stable by Brickworks
 Tenor  400 days / 24 months/ 36 months
 Series  8 series

The issue is available in eight series that come with a fixed period of 400 days, 2 years, and 3yr. It offers Rs 250 crores with an option of retaining over a subscription of Rs 250 crores. The Face value of the NCD bond is Rs 1000.

Investors need to invest a minimum of 10 bonds. Means invest for a minimum of Rs 10,000 in multiples of 1 bond. Interest payables available monthly, yearly, and cumulative. Individual coupon rates ranged between 9.00% to 10.00% and effective yield between 9.30% to 11.03%.

All categories of investors are eligible to apply for this secured NCD except for NRIs. They cannot apply to this NCD.

This secured NCD will manage by SMC Capital. Muthoot NCD has proposed to be listed on BSE. The NCDs are liquid investments.

Objectives of the Issue

According to the draft prospectus, the funds raised via NCD will utilize towards working capital. The company stated that at least 75 percent of net proceeds utilized for working capital and repayment of interest and principal of existing loans. The remaining 25 percent for general corporate purposes.

Credit Ratings

The proposed NCDs have been rated as “BWR A+” by Brickwork Ratings India Private Limited.  This rating indicates that instruments with this rating are considered to have a full degree of safety regarding timely servicing of financial obligations and carry the lowest credit risk.

Coupon Rates of Muthoot Fincorp Limited NCD

 Options/ Series  Category  Tenure  Interest Payments  Coupon Rate (Interest) Individuals  Effective Yield  Maturity Value
   I  Secured  400 days  Monthly  9.00%  9.38%  1,000
  II  2 Years Monthly  9.25%  9.65%  1,123
  III  3 years Monthly  9.50%  9.92%  1,000
  IV  2yr  Yearly  9.50%  9.50%  1,000
  V  3yr  Yearly  10.00%  10.00%  1,000
  VI  400 days  Cumulative  9.25%  9.30%  1,000
  VII  2 Years  Cumulative  9.50%  9.95%  1,000
  VIII  3 years  Cumulative  10.00%  11.03%  1,000

NCD’s Offered

 Category  NCD’s Reserved
 Qualified Institutional Buyers (QIB)   250,000 (10%)
 Non-Institutional Investors (NII)  1,000,000 (40%)
 High Networth Investors (HNI)  1,250,000  (50%)
 Retail Investors (RII)  0

Muthoot Fincorp offers secured NCDs that provide high interest rates up to 10 percent. In the last few years, company has earned consistently and increased its margins. It state that the company can pay the interest rates for its NCD holders. 

Disclaimer: This post is just information about the scheme. It does not give any advice or recommendation. Please read the offer document carefully and consult your investment adviser before investing.

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